Commercial Lines Modernization Bills Moving in the States

State legislatures have considered legislation to modernize commercial lines filing requirements. The following bills have been considered this year:

West Virginia SB 495 exempts several commercial insurance lines from the rate and rule filing requirements, including surety and fidelity. Under current law, rates and rules are filed under a file and use system with a 30 day waiting period. The Governor has signed this bill. New Hampshire HB 1389 would eliminate the 30 day waiting period for the approval of certain commercial insurance policy forms, including fidelity forms, and instead provides that these forms only would be filed for informational purposes. Under current law, rates for commercial insurance policies are not subject to a 30 day waiting period and only have to be filed for informational purposes. The bill has been sent to the Governor.

Missouri SB 594 would exempt large commercial policyholders who employ a full time risk manager or has retained a licensed insurance producer to negotiate on its behalf from the rate and form filing requirements in existing law. Under current law, commercial property and casualty forms are subject to a use and file system under which they must be filed within ten days of their effective date. Commercial property and casualty rates are filed for information only under current law. The bill has been sent to the Governor. Maryland SB 876/HB 1127 revises the existing law for exempt commercial policyholders to provide that the rates for these policyholders do not need to be filed. The new law reduces the financial thresholds that the policyholder must meet for its net worth from $5 million to $2.5 million, from $10 million to $5 million for its annual budget for nonprofit corporations, and from $10 million to $5 million for its annual revenues or sales to qualify for the exemption. The Governor has signed this bill.

Massachusetts HB 2159 would exempt specialty commercial lines of insurance from the existing law's rate and form filing requirements, including surety and fidelity. Insurers would have to maintain underwriting files, premium, loss and expense statistics, financial and other records regarding the specialty commercial lines contract of insurance that is exempt. New York SB 4719 would exempt commercial specialty lines of insurance from the existing law's rate and form filing requirements, including surety and fidelity.